Comcast Ruling Leaves FCC Unsure About Its Internet Authority

Commission says much of its broadband agenda is unaffected by the courts ruling, but others aspects are now highly uncertain.

After suffering a significant legal defeat in a federal appeals court, the Federal Communications Commission finds itself on uncertain footing as it looks ahead to many aspects of its broadband agenda.

The ruling, handed down Tuesday by the U.S. Court of Appeals for the D.C. Circuit, voided the FCC's 2008 order declaring that Comcast had violated its Internet policy statement by secretly blocking or slowing traffic from BitTorrent and other peer-to-peer services.

"Policy statements are just that -- statements of policy. They are not delegations of regulatory authority," Judge David Tatel wrote in the court's unanimous opinion.

FCC General Counsel Austin Schlick, who argued the commission's position before the court in January, sought to downplay the impact of the ruling, saying that in a blog post that it will have "no effect at all" on most of the proposals in the broadband plan recently delivered to Congress.

That's because many of those proposals aimed at boosting adoption and deployment of broadband services are hardly controversial and have a firm statutory mandate. But Schlick was quick to point out that the FCC's authority to implement other parts of the broadband plan, such as its recommendations for consumer protection and cybersecurity, is now in doubt.

"At the same time, yesterday's decision may affect a significant number of important plan recommendations," Schlick said. "The commission must have a sound legal basis for implementing each of these recommendations. We are assessing the implications of yesterday's decision for each one, to ensure that the commission has adequate authority to execute the mission laid out in the plan."

The central issue of the Comcast case, net neutrality, was conspicuously absent from the broadband plan, and supporters and opponents of the policy both agree that the court's ruling weakened the FCC's authority to set rules for how ISPs manage traffic on their networks.

Separate from the broadband plan, the FCC has an open proceeding on a proposal to enshrine the policy statement it relied on in the Comcast case as binding rules, and add explicit non-discrimination and transparency requirements.

The court ruling's impact on that proceeding has already been felt. Originally, the FCC had set today as the deadline for interested parties to submit reply comments in response to the first wave of feedback on the rule-making proposal. But when three groups asked the FCC to push back the deadline in light of the court ruling, the commission complied, and is now accepting comments through April 26.

Net neutrality opponents have been trumpeting the court's ruling as the final word striking down the FCC's authority to regulate broadband under its so-called "ancillary authority," which relies on the implied intent of the Communications Act, rather than the explicit language.

The FCC currently classifies broadband as an information service under Title I of that act, rather than a regulated Title II telecommunications service, which would subject ISPs to the same common carrier regulations as wireline telephone providers. In 2002, the majority-Republican FCC moved broadband service to Title I, downgrading the commission's authority to the ancillary level that the court ruled against this week.

Several pro-net neutrality groups have already called for the FCC to initiate a proceeding to reclassify broadband as a Title II service, clarifying its authority to enact binding open Internet regulations in a move that would encounter vigorous industry opposition.

"Title II is the worst fear of cable/telco broadband providers, which have warned of disastrous consequences," Rebecca Arbogast, an analyst with Stifel Nicolaus, wrote in a research note.

Michael Copps, the one remaining commissioner at the FCC who voted in favor of the 2008 order to censure Comcast, said he plans to push for Title II reclassification, and blasted the past commission policies to deregulate Internet service.

"The only way the Commission can make lemonade out of this lemon of a decision is to do now what should have been done years ago: treat broadband as the telecommunications service that it is," Copps said in a statement responding to the ruling. "It is time that we stop doing the 'ancillary authority' dance and instead rely on the statute Congress gave us to stand on solid legal ground in safeguarding the benefits of the Internet for American consumers. We should straighten this broadband classification mess out before the first day of summer."

Several lawmakers expressed alarm at the court's ruling, which they took as a sign that the time has come to update communications law to ensure that the FCC has clear authority over the Internet sector.

"As a champion of network neutrality, I have concerns about the ramifications that this decision could have on the commission's ability to prohibit unreasonable and anticompetitive discriminatory practices that would adversely affect consumer experience or choice," Sen. Olympia Snowe, one of the very few Republican supporters of net neutrality, said in an e-mail to InternetNews.com.

"The court's decision is indicative of the need for Congress to update existing laws and bring them in line with the current environment and better accommodate changes in the future," she added. "Very simply, federal telecom laws must reflect 21st century infrastructure and technologies."

Verizon has also called for a revision of communications statute, but its vision would move away from the Title I/Title II debate, tearing down the service-classification rules and replacing them with a light-touch regulatory environment in which the government would address specific allegations of consumer harm on a case-by-case basis.

"The problem is that the statute is irrelevant to the ecosystem that has developed," Verizon Executive Vice President Tom Tauke said in a recent speech. "Traditional regulatory models based on rules written to shape and control more static, 'one purpose' industries -- such as TV or telephone service -- are not only out of step with today's dynamic, converged Internet ecosystem, they are harmful to the innovation process that characterizes broadband and the Internet."